Calgary’s unemployment rate hits 8.5% as poverty gap widens

Calgary’s unemployment rate rose to almost nine per cent in June, a statistic that worries advocates as the city’s poverty gap widens.

According to the latest data from Statistics Canada, Calgary’s unemployment rate rose to 8.5 per cent, 0.4 percentage points higher than May’s.

This is higher than the national average of 6.4 per cent and higher than other major cities like Vancouver (5.6 per cent), Toronto (7.8 per cent), Montreal (6.2 per cent) and Edmonton (7.1 per cent). It is also the highest rate for the second consecutive month among major Canadian cities, with Toronto in second place.

However, Statistics Canada said the figures may fluctuate widely because they are based on small statistical samples.

Kate Koplovich, director of strategy for the Calgary Economic Development, said Calgary’s unemployment rate indicates that the city’s population growth has outpaced its labour force growth.

Data from the CED shows that Calgary’s labour force participation rate decreased by around 0.2 per cent month-over-month while the labour force increased by 0.1 per cent, or about 2,500 people.

The data also shows that Calgary’s labour force is growing slower than the national average month-over-month, but is still growing faster than the national average year-over-year.

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“What we’re seeing is a rise in our unemployment rate is mostly due to our population growth,” Koplovich told Global News on Friday, noting that the city’s population rose to 1.4 million in 2022.

“But if we compare where we are (right now) to this time last year, our employment grew by 3.5 per cent and we added more jobs than any other city … We are seeing that as more people come to Calgary, our economy can absorb that growth and provide them with the jobs and employment.”

She added that this isn’t a trend unique to Calgary. Other Canadian cities like Vancouver and Toronto are facing similar challenges, and Koplovich said she is hopeful that things will improve for job seekers.”We truly believe it’s due to more people coming to Canada than we’ve ever seen before and that Calgary remains a place for opportunity and where people can come and build a future.”

The rising unemployment rate is concerning for many in Calgary as the city’s poverty gap widened in recent years, however.

Basic necessities in Calgary cost more than every other major city in Canada according to the Market Basket Measure. According to Food Banks Canada’s material deprivation index (MDI), 23.4 per cent of Albertans are unable to afford two or more items that are expected to maintain an acceptable standard of living. That includes 10 per cent unable to afford clothing or 18 per cent unable to pay for dental care.

Nationally, 25 per cent of Canadians likely would fall under a poverty-level standard of living because they cannot afford two or more essential items. Black, South Asian and Indigenous people are also disproportionately represented in these statistics, the report said.

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The MDI is an alternative approach to measuring a household’s (two adults and two children) standard of living looking at the goods and services it has or has access to, along with activities it participates in. The MDI looks at 11 types of essential items Canadians surveyed said they could not afford.

Ameera Shivji of Vibrant Communities Calgary said she isn’t surprised and has heard many stories of Calgarians forgoing basic necessities to “stay afloat.”

“There’s definitely an affordable housing crisis right now and with fewer units up for rent, you’re certain see really fast growth in (rental prices),” Shivji told Global News on Friday.

“If it’s a choice between eating or retaining your housing, you’re likely to choose to retain your housing, which can have long-term consequences for your health. We also have higher utilities than Vancouver. Housing is definitely what I would say is the leading cause.”

For Calgarians experiencing a recent layoff, unemployment insurance is not always enough to make ends meet, said Shivji.

“For people that are employed but at lower-income levels … Our minimum wage hasn’t gone up since 2018. We (have one of the) lowest minimum wages in the country and the rising cost of living right now means it’s certainly not keeping up. And when you’re talking about people that are on a fixed income … If you’re in Calgary where you’re paying over $1,000 for a one-bedroom apartment, then you have very little for the rest of the month.”

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Shivji said she is glad the city and the province are focusing on building more housing in the city but more needs to be done to address the housing crisis.

“We need to keep that momentum going. But there are other things, like increasing minimum wage and immediate payments for people who are living on low incomes as little as $100 to $150 a month can mean the difference between retaining housing and losing your, or forcing a family to skip meals so that they can retain their housing.”

She added that employers could pay their employees living wages. According to a November 2023 report by Enough for All, Calgary’s living wage is $23.70 an hour. More than 50 businesses in Calgary provide a living wage to their employees, according to the Alberta Living Wage Network’s employer directory.

“If small businesses can do that, certainly the Walmarts and Loblaws of the world could step up with higher wages to help people out, especially during this time where we have record inflation,” Shivji said.

“I think the big thing is that they can advocate to the government for a subsidy … They can speak on behalf of their employees and say, ‘Maybe we can’t afford to pay a living wage right now, but here’s what we’re going to do. We’re going to advocate for you.’  I think that’s a really important step,” she said.

For youth and students specifically, Koplovich said summer employment in accommodation and food services may be an option.

“Our accommodation and food services employment increased … I think a summer job in services and retail … These things can help,” she said.

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— With files from Sean Previl, Global News.